Cal Am files opposition with PUC to public ownership of desal plant

California American Water officials insist in a recent filing with the state Public Utilities Commission they will not consider any public ownership proposal for the company's latest desalination plant project, even though no such proposal has been formally submitted.

The company said it will only consider a proposal to share project oversight if the Monterey Peninsula Regional Water Authority, also known as the mayor's desalination group, declines to support any alternative desal projects.

Those were among the highlights from a recent compliance filing with the PUC by Cal Am, which was required to respond to several public participation proposals submitted by the water authority and others.

In a separate filing, Cal Am outlined its contingency plans in case aspects of the desal project need to be changed. The filing includes backup plans for the desal plant's brackish source water, the plant site, plant failure or interruption, brine outfall, reduced demand forecasts and a project delay.

The filings, ordered by PUC administrative law judge Gary Weatherford as part of the project proceeding, were submitted on Oct. 26 and Nov. 1.

Cal Am is seeking a PUC permit for its proposed Monterey Water Supply Project, which includes a desal plant north of Marina combined with enhanced aquifer storage and recovery, and perhaps a groundwater replenishment project designed to allow a smaller desal plant. The project is designed to provide a replacement source of water for the Peninsula, which is facing a state-ordered cutback in pumping from the Carmel River that takes full effect at the end of 2016.

The Regional Water Authority's public participation proposal calls for a three-member advisory committee with various levels of oversight on nearly every aspect of the desal project. In response, Cal Am wrote that it "appreciates the cooperative nature" of the proposal, but "cannot support public ownership for the desalination component" of the water project.

While acknowledging public ownership had not been included among the public participation proposals, Cal Am pointed out that it had been raised by both Monterey Peninsula Water Management District and county officials. Cal Am spokewoman Catherine Bowie said she believed company officials were trying to be as clear as possible on the issue.

Some community leaders have called for public ownership of the desal plant, pointing to the county's public desal ownership requirement, and the water management district has offered to serve as the public owner, if needed, while the county is seeking a court ruling on the applicability of its ordinance.

But the PUC ruled late last month that its jurisdiction over desal plant ownership trumped that of both the county and local courts.

Cal Am argued there's no evidence public ownership would result in lower water rates or faster project completion.

Cal Am acknowledged that it had previously expressed support for some of the "concepts" in the authority's proposal, but said it wouldn't support any such proposal unless and until the authority ceased actively backing any alternative project.

The authority has commissioned a comparison study of three competing desal projects, including Cal Am's, along with the Deep Water Desal and People's Moss Landing Desal proposals, and is set to consider a draft report by Carlsbad-based Separation Processes Inc. later this week. It's designed to help inform the authority board on which project to support during the PUC proceeding.

Cal Am also made it clear it would seek permission from the PUC and the state water board before agreeing to any public participation proposal, and included in its filing a version of the authority's proposal that included a series of suggested changes.

Later in its filing, Cal Am also offered comments on a project financing proposal from the water management district, expressed support for three recycled water projects proposed by the city of Pacific Grove, and indicated it was still evaluating a proposal from the city to enter into a partnership involving the People's Desal project.

In the second filing, Cal Am repeatedly pointed out that it believes its current proposal is the best option available, and would only consider backup plans as a last resort.

Among the contingency plans, Cal Am suggested the use of shallower slant wells or horizontal Ranney wells extracting from the Sand Dunes aquifer, an open ocean intake nearby, or a slant well or ocean open intake near Moss Landing Harbor using the old Refractories infrastructure owned by Nader Agha. Cal Am also suggested it could consider locating the desal plant in Moss Landing, perhaps at the refractories or Deep Water Desal sites, and that an alternate brine outfall could also be relocated if needed.

Cal Am also argued that it had adequate redundancy to cover any plant failure or interruption and could use the extra water for additional needs in the unlikely event of reduced demand, but acknowledged that the company had "extremely limited" options in case of a project delay, which would almost certainly result in "emergency rationing."

The filing did not include any timelines, permitting milestones, cost estimates or any other details originally requested by the judge.

Next up for the Cal Am water project proceeding, the PUC will conduct a project cost workshop Dec. 11-13, and a pre-hearing conference on Dec. 13 at the commission headquarters in San Francisco.